5billion tax raid on British bank fortunes in Swiss banks… but we will know identities of "tax avoiders"

5billion tax raid on British fortunes in Swiss banks… but we will never know identities of 'tax avoiders' HMRC to claw back money British investors have hidden in Swiss banks

By
James Salmon

PUBLISHED:

00:56 GMT, 1 January 2013

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UPDATED:

01:23 GMT, 1 January 2013

The Chancellor George Osborne hailed the deal, signed in 2011, as the largest tax evasion settlement in UK history

Thousands of wealthy British investors hiding money in Swiss bank accounts will finally be forced to pay billions in unpaid tax under a deal that comes into force today.

Under the settlement between UK and Swiss authorities, an estimated 5billion will be clawed back and handed to HMRC over the next six years.

The deal, signed in 2011, was hailed as the largest tax evasion settlement in UK history by Chancellor George Osborne.

However last night critics attacked the deal as shielding ‘criminal tax avoiders’ – because they will be allowed to remain anonymous to HMRC as long as they pay what they owed in the first place.

The actual number affected by the deal is unknown because Swiss banks are notoriously secretive about clients – but they are likely to include anyone from investment bankers to celebrities and criminals.

The rich, many of whom have been hiding their wealth for decades, will see unpaid tax deducted from profits on investments and savings at the end of May.

At the end of May they will be given a final chance to disclose their affairs and pay what they owe.

If they do not, the money will be deducted automatically by Swiss authorities and repatriated to the UK.

The charge will be based on the amount of years the money has been hidden, the type of income and the prevailing tax rate in the UK and will range from 21 per cent to 41 per cent.

It is estimated the move affects 40billion of assets held in Swiss accounts by British investors.

But tax campaigner Richard Murphy said: ‘Honest taxpayers are seeing criminals who broke the law being allowed to wipe the slate clean.’

‘They should be forced to pay penalties and hand back interest on money they have kept illegally.’

‘A similar agreement was rejected by the German parliament in November due to concerns that tax evaders would be able to retain their anonymity.’